All Forum Posts by: Colby Miles

If a properties value is based off of the NOI and CAP rate then if the apartment building is empty weouldnt its value be 0?

Actually i have been thinking about that. The 4plex or lower deal seems nicer and i can get a $100,000 4plex. This way i can get a loan with 15 or 20 percent down and still have a low interest rate 30 year mortgage with a good credit score. I would still higher a property manager because i dont want that job. I want to be certified ao i know how to manage a property, but i dont want that headache. How does this sound for a first deal. I may be able to swing two 3 or 4 unit apartments with my small investment of $30,000...

Any ideas. I have about two years to refine my plan while i save up this initial cash.

That is a lot of great info. How do you calculate the grm? Is it a percentage bases on the local area? Also if i had a $150,000 mortgage at 5% for 20 years it would come out to about $985 per month. About $1000 more per year so still doable with my senario but still not great... What would be your suggestion for someone starting out with $30,000 and a certificate in real eatate management?

Im sure there must be a place near or in ft drum around the watertown area...

Thanks for this valuable information. I just realized i hadnt been subtracting the debt services from the NOI. Looking up the formula for the DSCR reminded me of that but it is also a bit discouraging knowing that if i invest $30k it is only going to yeild me about $2,500 per year and that i if everything goes well! The way i came to this conclusion, and you can check my math, is through th NOI of a $200,000 6 unit building with a CAP rate of 8%. This would yield about $16k per year. Now if me and a partner both put in $30k with $50 going toward a down payment. A 30 year $150k mortgage at 6% would be about $900 per month. Thats nearly $11,000 per year and leaves $5,000 for me and a partner to split.

At this rate i will be old and dead before i will wver be finantially free... What am i missing here?

Appreciate it robert but i wont have the money until the end of next year. Just trying to figure out how to make it work at this point.

Good advice frank. I really appreciate your added insight.

So then my only option is to have investors to help me out?

Now that I think about all of the advice I have received on here. It may be more doable for me to aquire a $200,000 six unit building. that would only require me $40k-$50k down payment and I could do that without other investors if I can get a $30k personal loan or if I have to just apply for two $15k personal loans from two different lenders at the same time. combined with my on hand cash of $30k I think It would be more managable. And If I need to, since my personal vehical is already paid for it is worth $10,000 and I could use it as collateral for $8500 as my current bank will pay out 85% of a vehicles value.

This would give me a total of $68,500 for a $200,000 apartment building. Does this seem more realistic? Once I get this first purchase out of the way I think things will move more smoothly, but I would be on a 5 year track to pay off these loans and then refinance the property at 5 years, hopefully with much added value through smart property management.

any thoughts?>

p.s.
Here is the course I am taking in real estate management.

http://www.apu.apus.edu/academic/programs/degree/206/undergraduate-certificate-in-real-estate-management

Can you elaborate on these other ways Norman and explain more on how this would be written out in an investment contract. Seems like the cheapest way to do this would be a $30k personal loan from a bank. Even with 10% interest over 5 years it would still be a better deal than giving a third of my profits away... Any opinions on this?